52 Government Finance Statistics Manual 2014
may be recorded in the periods in which they are paid,
and any fi nal tax liability on income may be recorded
in the period in which it is determined.
3.83 Income taxes are normally imposed on the
income earned during an entire year. If monthly or
quarterly statistics are compiled in the absence of
monthly accrual administrative records, indicators of
seasonal activity or other appropriate indicators may
be utilized to allocate the annual totals.
3.84 Taxes on the ownership of specifi c types of
property may be based on the value of the property at
a particular time, but are deemed to accrue continu-
ously over the entire year or the portion of the year
that the property was owned, if less than the entire
year. Similarly, taxes on the use of goods or the per-
mission to use goods or perform activities usually
relate to a specifi c time period, such as a license to
operate a business during a specifi c period.
3.85 Some compulsory transfers, such as fi nes,
penalties, and property forfeitures, are determined
at a specifi c time. Th ese transfers are recorded when
the government has an unconditional legal claim to
the funds or property, which usually is when a court
renders judgment or an administrative ruling is pub-
lished. If such judgment or ruling is subject to further
appeal, then the time of recording is when the appeal
is resolved.
3.86 Determining the time of recording for grants
and other voluntary transfers is infl uenced by a wide
variety of eligibility conditions that have varying legal
powers. In some cases, a potential grant recipient has
a legal claim when it has satisfi ed certain conditions,
such as the prior incurrence of expenses for a specifi c
purpose or the passage of legislation. Th ese transfers
are recorded by recipient and donor when all condi-
tions are satisfi ed. In other cases, the grant recipi-
ent never has a claim on the donor, and the transfer
should be attributed to the time at which the cash
payment is made, or when the goods or services are
delivered (see paragraph 5.105).Time of recording dividends
3.87 Dividends and withdrawals of income from
quasi-corporations are distributive transactions for
which the time of recording depends on the unit’s
decision regarding when to distribute income (see
paragraphs 5.111–5.119). Th e level of dividends isnot unambiguously attributable to earnings of a par-
ticular period, and dividends are to be recorded as of
the moment the associated share starts to be quoted
“ex-dividend.” Withdrawals of income from quasi-
corporations are recorded on the date the payment
actually occurs.Time of recording transactions in goods, services, and nonfi nancial assets
3.88 Th e time of recording transactions (including
by barter, payment in kind, or transfer in kind)^15 in
goods and nonfi nancial assets is, in principle, when
economic ownership changes, which depends on the
provisions in the sales contract (see paragraphs 8.13–
8.17). When change of ownership is not obvious, the
time of recording by the transaction partners^16 may be
a good indication and, failing that, the moment when
there is a change in physical possession or control. For
example, a change of ownership is imputed to have
taken place under a fi nancial lease when the lessee
takes control of the asset.
3.89 Transactions in services normally should be
recorded when the services are provided. If a service,
such as transportation, is provided at a specifi c time,
then the transaction is recorded at that time. Some
services are supplied or take place on a continuous
basis. For example, insurance, and rental of housing
services are continuous fl ows and should be recorded
continuously for as long as they are being provided.
More practically, the value of the services attributed
to a reporting period is based on the quantity supplied
during the period rather than the payments required.
3.90 Several other transactions also relate to fl ows
that take place continuously or over extended peri-
ods. For example, operating leases and consumption
of fi xed capital accrue continuously over the whole
period a fi xed asset is used and interest^17 accrues
continuously over the period that the fi nancial claim
exists. Th ese fl ows are recorded as being provided(^15) Th ese transactions are excluded from a pure cash basis of
recording.
(^16) To maintain symmetry in the macroeconomic statistical system,
the time of recording should be the same for both parties to the
transaction.
(^17) Th e counterpart entry to accruing interest expense is a simul-
taneous increase in the amount of liability outstanding. Peri-
odic payments reduce the liability that has accrued and are not
expense transactions.